Atex acquires Unisys: Q&A with Don Oldham, CEO, DTI

newspaper techniques: The system offer just got smaller for publishers; is this a good thing for the industry and for this sector?

Don Oldham: More choices are almost always better for customers (publishers). But it is getting pretty clear that this industry won’t support as many choices as there are now. This acquisition is just more evidence of that.

nt: What does this mean to you as a competing supplier when two of the largest system providers join forces?

D. Oldham: It means that there is one less competitor. But it is also interesting that that you characterise these two vendors as two of the largest. If you consider Unisys as just its newspaper division, DTI is larger than that division. A different question is whether putting together two unprofitable and declining vendors can make a profitable and successful one?

nt: With newspapers constantly driving vendor prices down, how does a vendor remain profitable and viable in this climate?

D. Oldham: DTI has remained profitable and viable this whole time, so it is possible. The secret was to deliver highly unified systems instead of collections of disparate solutions. The secret going forward is to have web publishing be a lead part of the unified system, and one that can enable newspapers to become highly profitable online. Neither Unisys nor Atex have industry leading solutions in that area, so it is curious how putting them together will make a difference. This merger seems to follow the Atex model of recent years of acquiring customers through acquisition because they can’t get them through direct sales. The additional system maintenance revenue they get from the newly acquired customers continues to prop them up for a while, until it goes away as the myriad of old systems they end up owning eventually die.

Since Atex already owns a significant collection of editorial and advertising systems from past acquisitions, what are they getting from Unisys except the customer base? That customer base won’t stay just because Atex is the new owner. In fact they should be worried about how long their current systems will be supported by competent staff. Publishers must go where they can find a solution to make significant new revenue online. This acquisition will not be a long-term win in the industry.

Page first published: 28.11.2006